After 20 years can we not see that a global economy does not work? We pretend to have trade balance and that will, supposedly, drive a global economy. But we don't have trade balance, and countries do what they like regardless of what their 'representatives' state at UN meetings, or during diplomatic 'summits.'
It's all a lie. Every country looks out for itself, and not so much because they 'serve' the people, but because only those in government make the rules and become rich as a result. Not through hard work or innovation, but through treacherous laws and complex regulations that never do what they're stated goals are supposed to achieve. That is because government is mediocre when it comes to intelligence, hard work, and integrity.
Shrink government, make representatives accountable and subject them to all laws they create, and mandate that regulations be simple and apply to all - no winners, no losers, no loopholes.
And outlaw ANY gift or money from all lobbyists.
BTW Chinese billionaires (a.k.a. communists) are buying miles and miles of western US lands and digging into aquifers and taking water by the billions of gallons. They have stolen resources from Africa - corrupt governments there care little. We need to stop political correctness NOW and mandate a limit on foreign land ownership. That is what is driving up our rents, home prices, etc. NO MORE GLOBAL ECONOMY. It doesn't really exist.
It's all a lie. Every country looks out for itself, and not so much because they 'serve' the people, but because only those in government make the rules and become rich as a result. Not through hard work or innovation, but through treacherous laws and complex regulations that never do what they're stated goals are supposed to achieve. That is because government is mediocre when it comes to intelligence, hard work, and integrity.
Shrink government, make representatives accountable and subject them to all laws they create, and mandate that regulations be simple and apply to all - no winners, no losers, no loopholes.
And outlaw ANY gift or money from all lobbyists.
BTW Chinese billionaires (a.k.a. communists) are buying miles and miles of western US lands and digging into aquifers and taking water by the billions of gallons. They have stolen resources from Africa - corrupt governments there care little. We need to stop political correctness NOW and mandate a limit on foreign land ownership. That is what is driving up our rents, home prices, etc. NO MORE GLOBAL ECONOMY. It doesn't really exist.
2
This reporting is heavily anecdotal and once again unbalanced. Why not even a reference to the important highly relevant facts laid out by China economy expert Nicholas Lardy in these very page just a few days ago: I) Both real disposable income and consumption expenditures of Chinese households are growing strongly. 2) Services, not industry, are driving China’s growth, as has been the case for three full years. 3) Per capita incomes in China are reaching a level where a growing share of spending is on entertainment, travel and other services rather than on goods. etc.. etc.. Argue with this data if you want but don't ignore it because it doesn't fit with the story you are pushing.Lardy further rightly points out despite fervent desires otherwise there is little evidence that China’s economy is slowing significantly and you can quibble whether its 5% or 7% but that is still at least twice what the US and the UK the healthiest developed economies are experiencing re year on year growth. China is facing and will face bumps along the road in its development everybody in China and the rest of the world that thinks rationally accepts that why not just report on the issue in a balanced manner?
5
China's economy is interspersed with elements of a Ponzi scheme and international businesses and thus world are its unknowing victims. The relief they seek is getting their currency included in world's basket of currencies; it is critically important that IMF do an extreme due diligence.
1
We are leaving on a long ago planned trip to China. When my husband notified Chase bank that he was going to be using his Chase ATM card on the trip, Chase said he wouldn't be able to use it. We travel internationally about twice a year and this is the first time we have been told this for any country, including China when we went two years ago. Are we, in the US, being told everything?
2
They only need to look at what took place in American were the real foreclosure number is pretended as if no one actually knows!
You foreclosed on on 4 million household in 2009-2010 but we keep giving this figure of 5 million however I believe between 2007-2014 there was at least 10 million. At least 1 million of FHA & AV loan did not even get looked at for the President's modification program.
The China government is trying to reset and you see that the Fed is wanting to high interest rates, but as thing are only getting back to increasing because the interest are low to none, but the Fed knows it must raise rates because the it how they make money by doing nothing!
We screwed the rest of the world in 2009 and China doing it now. Who is buying stock now when the Dow at best should only be about 8.500!
You foreclosed on on 4 million household in 2009-2010 but we keep giving this figure of 5 million however I believe between 2007-2014 there was at least 10 million. At least 1 million of FHA & AV loan did not even get looked at for the President's modification program.
The China government is trying to reset and you see that the Fed is wanting to high interest rates, but as thing are only getting back to increasing because the interest are low to none, but the Fed knows it must raise rates because the it how they make money by doing nothing!
We screwed the rest of the world in 2009 and China doing it now. Who is buying stock now when the Dow at best should only be about 8.500!
it proves that chinese shouldn't follow the crazy american's 'get rich or die trying' way. Saving is a very good behavior for the life. it's the american who waste the most resource on this planet. i dont understand why american need those ridiculous gross pickup just for going out to have a starbucks. just because that, so much people dead in middle east.
now i think chinese should be cool down to think about which way is better for developing.
now i think chinese should be cool down to think about which way is better for developing.
1
What is the point to encourage the so-called "consumer expending"? Spend more money on military budget! The military manufactures can create tons of high paid jobs and all workers are "patriotic". Look at what US did and always does! Does China have a NASA? Does China have a Boeing? Does China have a decent Silicone Valley? Bullying small and weak countries is totally different from standing up to USA's military mighty. China has a long way to go from this front.
Chinese investors are learning the same lesson Americans and Europeans learn in 2008-2009 period: If you have to use the money in the next two years, don't put it in the stock market.
1
If you get filthy rich in China, you emigrate.
" They are worried about finding jobs"." They are worried
about early retirement". " They fear layoff".
Welcome to capitalism. It all sounds very familiar
to us as we go through this phenomenon every five
or six years. Chinese are getting a lesson in capitalism.
Of course the tuition fees is very high.
about early retirement". " They fear layoff".
Welcome to capitalism. It all sounds very familiar
to us as we go through this phenomenon every five
or six years. Chinese are getting a lesson in capitalism.
Of course the tuition fees is very high.
1
As a young professional in the US trying to find work that pays enough to put a roof over my head and food in my belly, all I can say to my Chinese peers who are bemoaning their loss of ability to buy luxury goods in Paris and Venice, travel to overseas, and stay in hotels rather than Airbnb'ing it: cry me a river.
I don't even have aspirations to own my own home, let alone sell one.
I don't even have aspirations to own my own home, let alone sell one.
2
Could it be that the Chinese economy is floundering because most of the developed world's consumers who have the money to buy China's exports are already up to their eyeballs in "Stuff?" If garage sales are any indication, the US consumer is full of stuff & can't get rid of it fast enough.
Any economy where businesses pay their employee's a good living wage will prosper. A 5 year old child knows that the more money a person makes, the more they spend. But it must be all people not just the privileged few. Pay your employees well, treat them fairly and with respect and you will thrive. Communism does not work.
So the Chinese middle and lower class will live like American middle and lower class. I guess things are the same the world over. All the things the Chinese are worrying about such as early retirement, financial independence, job security are things American worries about all the time.
2
Another reminder that this China is the collective term limited elected leadership China of the gradual free market capitalist practical reformer Deng Xiaoping. Mao Zedong is buried in a Tiananmen Square tomb with his picture gazing down from the entrance to the Forbidden City.
The reckless incompetent fraudulent corrupt crony capitalist corporate plutocrat oligarchs who nearly brought on another Great American Depression were never held accountable for their action and inaction. China is not so benevolent nor forgiving. In lieu of a death sentence, prison may be the preferred punishment for the culprits.
The reckless incompetent fraudulent corrupt crony capitalist corporate plutocrat oligarchs who nearly brought on another Great American Depression were never held accountable for their action and inaction. China is not so benevolent nor forgiving. In lieu of a death sentence, prison may be the preferred punishment for the culprits.
2
Sustainable economic expansion cannot be achieved by an undemocractic, authoritarian government rife with corruption. It's that simple.
1
So, the Chinese somehow thought that Capitalism was a self-fulfilling benevolent cycle of up, up, riches and more riches, more, more for everyone anywhere all the time...
Nope, Capitalism is by definition boom and bust, a few oversize winners and many losers, wild swings, and a dizzying cycle of up, up, up, and down, down, down.
Furthermore, without a safety net and strong regulation that enforces transparency in investments, job creation, hiring, and a level playing field for small businessmen, as well as an effective and honest government --just as the nineteenth century and the Great Depression have show without a doubt-- Capitalism can bring unbridled poverty and destruction, tremendous destitution and rampant ruin --just ask Marx, or Mao.
If somebody should have know this, it would be, of course, the "Communists" in control of China, but we forget that today they are truly oligarchs, and that the powerful and well-connected in China will certainly make it mostly unscathed, their wealth safely stored in Switzerland and other swank places.
Nope, Capitalism is by definition boom and bust, a few oversize winners and many losers, wild swings, and a dizzying cycle of up, up, up, and down, down, down.
Furthermore, without a safety net and strong regulation that enforces transparency in investments, job creation, hiring, and a level playing field for small businessmen, as well as an effective and honest government --just as the nineteenth century and the Great Depression have show without a doubt-- Capitalism can bring unbridled poverty and destruction, tremendous destitution and rampant ruin --just ask Marx, or Mao.
If somebody should have know this, it would be, of course, the "Communists" in control of China, but we forget that today they are truly oligarchs, and that the powerful and well-connected in China will certainly make it mostly unscathed, their wealth safely stored in Switzerland and other swank places.
5
These are just growing pains along the road to world domination. Nothing has really changed. It is just going to take a little longer and be a bit more difficult than originally thought.
China engineered growth partly just for growth's sake, so insiders making a crapload of money, and give China world bragging rights as the king of the world. They kept the pedal to the metal, like a drunk driver that thinks they'll never crash or get pulled over by the police. Now, the hangover is going to be painful. Nice long-term planning, Communist Central Planning Committee.
1
The result of a lack of open discussion, a lack of sound advice, from a variety of real financial experts with real information.
How can anyone trust the Chinese Communist Party to tell you the truth on their Economy? Our Economy is an open book. The numbers are there for everyone to see Monday thru Friday. Apple goes up and down, as does Google. The government doesn't intervene in the process. If there is some bad news about a company, it is on Twitter in about 20 seconds. We do not have internal intelligence services that "pollute" what we chat about or what is published. If an economist writes an article that is critical of the government policies, that economist will not be jailed. In my opinion the Chinese Economy is a structure made out of a lot of glass. When a few big stones are tossed at it, it will crack, then crumble and perhaps out of this disorder the Chinese People will force political change, so they can have some freedom for a change.
This is only going to add to global deflationary pressures. The idea that China's downturn will not have consequences for us. We are more competitive now because China's wages have gone up. But it now looks like China will slash their currency and hire people at lower wages- destroying their consumer base, and exporting the pain to the USA. Our own stock market is also booming, but it is way above what wages or corporate earnings are. It feels like 2006 all over again...
2
As to issues of Chinese economy, China may be its own enemy. Just look at those strange and epileptic rules and policies that is always power/politics-centric and fix the wrong things. The market has to be open and truly free, and private enterprises need to take over and become the main source of economic output, in order to create diversified, vibrant and healthy economy. China had opportunities to transform itself in the past decades, but the country did not and could not carry out those badly-needed reforms in various aspects, because it has been its own enemy.
Yes, Virginia, stock market crashes affect consumer sentiment, but because such a small percentage of Chinese are currently invested in their stock market, they will dodge a bullet we cannot.
That we cannot dodge a similar bullet and how American pensions and futures are completely tied to the tyranny of the stock market (and what the means) should be the subject of more articles.
That we cannot dodge a similar bullet and how American pensions and futures are completely tied to the tyranny of the stock market (and what the means) should be the subject of more articles.
3
For years I've wondered how the Chinese model could sustain itself. A system can only succeed by sustaining some level of meritocracy, which in practical terms is the opposite of corruption when corruption means people are promoted based on family ties or deals are made based on bribes rather than merit.
Corruption is like rust or rot and can never be abolished, only managed to "tolerable" levels. How can the Chinese government be up to the task of doing this in the long term when their only accountability to their people is based on having enough power to crush any opposition to their policies?
People within their government are promoted by the government itself, which controls the press and the courts. From whence comes the legitimacy of their power?
When the economy is rolling, people don't tend to worry about their government and, in any case, tend to give it credit for the improvement in their lives- especially when they see people around them without connections starting their own businesses and realizing success.
It will be interesting to see how China's government will fare in real crisis. I'm not sure if this is the one, but eventually the Chinese people will rebel if it becomes apparent that their leadership is siphoning most of the goodies to their own families and friends.
Corruption is like rust or rot and can never be abolished, only managed to "tolerable" levels. How can the Chinese government be up to the task of doing this in the long term when their only accountability to their people is based on having enough power to crush any opposition to their policies?
People within their government are promoted by the government itself, which controls the press and the courts. From whence comes the legitimacy of their power?
When the economy is rolling, people don't tend to worry about their government and, in any case, tend to give it credit for the improvement in their lives- especially when they see people around them without connections starting their own businesses and realizing success.
It will be interesting to see how China's government will fare in real crisis. I'm not sure if this is the one, but eventually the Chinese people will rebel if it becomes apparent that their leadership is siphoning most of the goodies to their own families and friends.
The simulacrum of an economic system that the Chinese insist on building, rather than laying the foundations that prevent collapse of sectors propped up artificially by the government, is the great weakness of China's efforts to "modernize". The rapacious excesses that are exposed when we see faked goods in everything from pharmaceuticals, to industrial equipment, to Disney videos, to stores with the "Apple" logo, to a bogus Tesla clone, to cloned architecture and artwork is not just a sign of a problem with disregard for intellectual property rights. It is the evidence of striving to get rich at any cost, to have all the appearances of wealth and success. What we see - or what they want us to see as evidenced by the strenuous efforts at censorship - is a facade, a theatrical set piece. Following that metaphor, we see the government's economic "experts" attempting to continuously change the scenery to have us believe their show has a solid story line, going from scene to scene. What's really happening is that they draw the curtain on every staged act when it starts to collapse, then rush about putting new set pieces on the stage so they can again raise the curtain and show off a shiny new China. Yes, this is all real money and some - who are lauded for their "genius" at getting rich - have been "winners". There is still something to all they do that resembles nothing more than the biggest Ponzi scheme the world has ever seen.
China is becoming a fractured economy, with hyper-growth in a handful of the former SEZs and huge swathes of the country yet to catch up. Trading in cheap labor as if it were a commodity was only going to last so long. The huge Soviet-style 5-year plan interior cities will sit vacant until they can transition to some kind of mixed economy, for the whole country, that also includes service and innovation. Meanwhile, the CCP will continue to prop it up with vast amounts of money reserves. This fusion of communism and capitalism is an interesting experiment, if anything.
The export boom is always the easiest part. Unfortunately for China and the rest of the economic world I don't think the ruling Communist Party is up to the challenges that lie ahead. They don't have a clue what to do and their purposefully ill-informed population of designer-clad peasants will be no help.
Lately some of the Presidential wannabes in the GOP have taken to bashing China for lack of any more domestic victims on which to focus their viterol and discriminatory comments. The best thing this country can do to mitigate the impact of turmoil in the Chinese economy, that to come in Europe and other disruptions around the globe is to get our own house in order! We need major investment in our infrastructure and higher education systems. We need to accelerate programs to promote sustainable non-fossil fuel sources of energy. Some of these things require direct government involvement. We need to discard the foolishness of Grover Norquist's "No New Taxes Pledge" stop starving fundamental programs to give tax cuts to those who don't need them; and reign in the military-industrial complex. Interest rates could not get any lower, now is the time for our Federal Government to be bonding major programs to fix our crumbling infrastructure and develop a nationwide high speed rail system with supporting regional light rail systems. China has been a house of cards for decades, soaring too high too fast and destined to come back to earth. We can insulate ourselves from that by not scapegoating the Chinese but by doing what we should have been doing all along in THIS country. It is time we start hearing some positive proposals instead of the foghorn that is Trump.
2
This is the problem with China sending the best and the brightest to the US and the West to learn economics. They come back brain damaged.
By mimicking the "Helicopter Ben" strategy injecting huge credit binges into the hands of the predator class who only gamble with the funds at their disposal, all that accomplished is blowing huge asset bubbles.
Real stimulation has to be targeted to real projects.
For example, China has gigantic demands for clean water and pollution control. The PBOC needs to use long-term, low-interest QE to buy Development bonds for canals and desalinization.
Same with decontamination projects. High-end affordable housing is another priority area. Each of these projects would meet high national priorities with real economic demand. They require large labor supplies and huge physical capital.
That's the way to stimulate real economic growth... that and writing down inflated assets.
By mimicking the "Helicopter Ben" strategy injecting huge credit binges into the hands of the predator class who only gamble with the funds at their disposal, all that accomplished is blowing huge asset bubbles.
Real stimulation has to be targeted to real projects.
For example, China has gigantic demands for clean water and pollution control. The PBOC needs to use long-term, low-interest QE to buy Development bonds for canals and desalinization.
Same with decontamination projects. High-end affordable housing is another priority area. Each of these projects would meet high national priorities with real economic demand. They require large labor supplies and huge physical capital.
That's the way to stimulate real economic growth... that and writing down inflated assets.
1
The transition to consumer driven economy is not a simple task because it is not in state control. What mere wages they have been getting for the past two or three decades does not provide much of a room to go out and spend on little drop in prices. Their top 1% will do as well as top 1% in any country. So, there is no problem in selling luxury goods, but the luxury goods do not create many jobs, may be 1% of the jobs. The future of Chinese economy will be a slow retreat like a Chinese torture.
1
China needs to focus on cleaning up its environmental problems. They will never have a successful economy if people can't breath the air and risk being blown up in an industrial explosion. I don't understand why the leadership puts so much emphasis on growth and so little emphasis on environmental protection.
1
These comments are mind boggling. Underlying
theme is that the downturn in China is due to
(1) dictatorial nature of government and (2) incompetence
of Chinese government. These downturns are more
common in USA, Europe and Japan. In fact , democratic
Japan is still mired in recession and Europe is growing
at snail's pace after years of recession and stagnation.
USA economy is growing after massive debt ( Fed
bought govt. securities worth $4.5T) and another
$1T stimulus. Middle class is hardly experiencing
the growth with stagnant wages, part time jobs
and measly pay raises equal to inflation rate. All
economies sooner or later move through cycles.
There are no exceptions.
theme is that the downturn in China is due to
(1) dictatorial nature of government and (2) incompetence
of Chinese government. These downturns are more
common in USA, Europe and Japan. In fact , democratic
Japan is still mired in recession and Europe is growing
at snail's pace after years of recession and stagnation.
USA economy is growing after massive debt ( Fed
bought govt. securities worth $4.5T) and another
$1T stimulus. Middle class is hardly experiencing
the growth with stagnant wages, part time jobs
and measly pay raises equal to inflation rate. All
economies sooner or later move through cycles.
There are no exceptions.
2
China has problems but, contrary to many sweeping conclusions drawn by commentators in this column, it's not finished yet. What erodes confidence and sows gloom is the government of China. It's 70 richest politburo members are worth more than all current members of the US Congress, the Executive office and Supreme Court combined. China is ruled by its 1%. What China claims it wants to do is empower its people, to make them richer, to make the Chinese economy a consumer-driven one, providing a new vehicle of national wealth. For the Chinese government to make the changes they say they hope to make, they must go against the interests of the richest and most powerful people in the country: themselves. How likely does this seem?
As Professor Shih notes in the story, well-paying jobs for college graduates are rare and difficult to come by, requiring most young grads to rely on their parents' relationships with government and business leaders to find one. This situation is not new, in fact, in Beijing, a city with some of the best prospects for job-seeking college grads, wages have stagnated for well over a decade among college grad applicants, while the prices of living essentials--homes, food, utilities--have all increased in price, some dramatically. From the perspective of common Chinese people, the move toward a consumer-driven economy has not yet begun.
As Professor Shih notes in the story, well-paying jobs for college graduates are rare and difficult to come by, requiring most young grads to rely on their parents' relationships with government and business leaders to find one. This situation is not new, in fact, in Beijing, a city with some of the best prospects for job-seeking college grads, wages have stagnated for well over a decade among college grad applicants, while the prices of living essentials--homes, food, utilities--have all increased in price, some dramatically. From the perspective of common Chinese people, the move toward a consumer-driven economy has not yet begun.
When I visited China before its economic slowdown, the Chinese consumers appeared to use cash rather than credit cards in shops and restaurants. Many of the Chinese we spoke with, as well as Americans who lived in China, confirmed that even major transactions were carried out with cash, even automobile and real estate purchases. While that protects consumers from excess debt, it restrains consumer spending considerably. The largest untapped market for Chinese goods is China itself.
2
The majority of Chinese do not have access to credit cards. I found that most Chinese university students thought credit cards and debit cards were the same thing. The very idea of 'credit' is still a mystery to most.
Differently to what a lot of people assume, China is not a totalitarian dictatorship where the ruling class does whatever they want without freedom for individuals.
The government interferes very rarely into private citizens lives. One can stand up in any Beijing restaurant on a table and scream that the Communist Party are a bunch of thieves and nothing will happen (except maybe being told to not stand on the tables). The private economy created Chinas wealth and there is very little government interference there (certainly much less than for example in Europe).
And the ruling class (and probably the majority of ordinary citizens) sees the current system as legitimized by providing peace, stability and economic progress to average citizens, while basically people can do, think or say whatever they want as long as they do not create a credible threat to the political system.
Only once one understands that China is not the evil dictatorship that many people commenting here seem to believe it is, one can understand the risk of an severe economic downturn to the political system.
This system exists because most average people in a very crude way of democracy believe it is in their advantage and support it. If in the same crude democratic way, if the majority of Chinese should change their opinion, their are only two options: either China really turns into that totalitarian dictatorship everyone thinks it is and that majority is oppressed or there is some kind of change.
The government interferes very rarely into private citizens lives. One can stand up in any Beijing restaurant on a table and scream that the Communist Party are a bunch of thieves and nothing will happen (except maybe being told to not stand on the tables). The private economy created Chinas wealth and there is very little government interference there (certainly much less than for example in Europe).
And the ruling class (and probably the majority of ordinary citizens) sees the current system as legitimized by providing peace, stability and economic progress to average citizens, while basically people can do, think or say whatever they want as long as they do not create a credible threat to the political system.
Only once one understands that China is not the evil dictatorship that many people commenting here seem to believe it is, one can understand the risk of an severe economic downturn to the political system.
This system exists because most average people in a very crude way of democracy believe it is in their advantage and support it. If in the same crude democratic way, if the majority of Chinese should change their opinion, their are only two options: either China really turns into that totalitarian dictatorship everyone thinks it is and that majority is oppressed or there is some kind of change.
5
You are right in that China is not an "evil" dictatorship, but it is a corrupt and self-serving one. It responds to public opinion not because it wants to or likes to, but only to try to preserve the power of the Communist Party and at the local level, the power/influence/wealth of corrupt government officials.
Another way to look at things is to realize that one reason China is in the mess it is in today is because for the past 25 years, nobody has been allowed to challenge the "economic growth at all costs" doctrine, which has resulted in crony capitalism and widespread economic degradation.
Yes, you can criticize the government to some extent, but do so in writing, or on WeChat/Weibo, and you'll find the PSB at your doorstep within 24 hours, and your online accounts deleted.
Another way to look at things is to realize that one reason China is in the mess it is in today is because for the past 25 years, nobody has been allowed to challenge the "economic growth at all costs" doctrine, which has resulted in crony capitalism and widespread economic degradation.
Yes, you can criticize the government to some extent, but do so in writing, or on WeChat/Weibo, and you'll find the PSB at your doorstep within 24 hours, and your online accounts deleted.
"Leisure spending still exists, of course. Popular restaurants in Beijing are crowded. Earlier this month, groups of Chinese tourists snapped up all manner of luxury goods one weekend at Galeries Lafayette in Paris, a high-end destination."
Leisure shopping is done by the class of people, sometimes called "the leisure class," who are benefiting from the economy, regardless of the slowdown. That class includes people such as those with professional degrees, high-level government employees, and those who are well-off due to inheritance. The situation is similar in the U.S., where one of the only really good sectors of the stock market is "consumer discretionary," while "consumer staples," which generally refers to purchases of low-level necessities like food and clothing, is a relative laggard. The out-performance of consumer discretionary stocks indicates that the well-off are doing very well in both China and the U.S.
Leisure shopping is done by the class of people, sometimes called "the leisure class," who are benefiting from the economy, regardless of the slowdown. That class includes people such as those with professional degrees, high-level government employees, and those who are well-off due to inheritance. The situation is similar in the U.S., where one of the only really good sectors of the stock market is "consumer discretionary," while "consumer staples," which generally refers to purchases of low-level necessities like food and clothing, is a relative laggard. The out-performance of consumer discretionary stocks indicates that the well-off are doing very well in both China and the U.S.
10
A few years ago 60 minutes ran an article about "ghost" cities all over china and now we hear about zombie factories that can't produce anything because the Chinese economy tanked. Instant rust belt. In true greedy capitalistic fashion the government put 30% of it's citizen's retirement pensions on the craps table last week. Capitalism is a failed economic policy for all but the top 1% global financial elite who have no social conscience and want only to destroy companies and government, and people lives, for personal profit. The Good People of China, India and other "emerging" nations are all going to suffer this same social catastrophe, and there will be universal uprisings, unless WE Americans and other Western countries seriously regulate and tax "investors" before they can spread more economic strangulation and chaos in the world. It must stop NOW!
http://www.businessinsider.com/pictures-chinese-ghost-cities-2010-12?op=1
http://www.businessinsider.com/pictures-chinese-ghost-cities-2010-12?op=1
13
You need to do a little more reading. China does not have capitalism. It is a form of authoritarianism or, to offer an analogy, crony capitalism to the nth degree.
No, it is not capitalism that has failed. It is the government that has failed, and making money off that failure. Simple regulations do not exist because of this, but it did as little as 25 years ago.
Americans should follow the austerity example of the Chinese; they need it.
6
Americans to selfish an unorganized maybe 50 years ago when we had good unions an people who joined unions to make better work rules. Now we have government telling people they have no right to fair labor rules . Right for work rules now make fair for companys to make own rules . We have 16 million fewer jobs in usa then we had 7 years ago an they keep telling people in usa we are in recovery as our wages fall
1
You seem to be missing the point that low demand means fewer jobs. And you also are missing the fact that for the bottom half of American citizens, jobs that pay adequately or provide benefits or job security are fewer every day. It seems to me that the only people calling out for "austerity" are those well off enough that they would not be affected, those who see it as cuts for other people only. If you try to take Janis' pension or 401-K, or slash her pay, or raise her taxes, she would probably not smile and say "High time."
1
Clearly, you've never seen Chinese spending.
1
Difficult to know how deep problem really is. I have friends who say jobs are available but wages are stagnant. Sharing economy is a solution?
1
China's economic growth has been determined by the huge investment and growth of working-age population. Their total factor productivity (TFP) was a lot lower than other Asian counterparts if we compare it with others at similar high growth period. According to prof. Harry X. Wu of Hitotsubashi University in Tokyo, China's average TFP per year during 1978-2012 was only 1% in comparison with Japan's 4% during 1950-1970, Taiwan's 3% during 1966-1990 or Korea's 2% during 1966-1990. After 2007, it has been negative in China. This is the one of the serious causes of China's sudden slowdown of economy.
In addition, China's statistic bureau disclosed that their growth of working-age population peaked this year. Chinese government cannot change these two determinants of their economic growth just like their stock market intervention even though they try all the economic measures. According to a CEO of a Japanese auto parts manufacturer that sells most of the automobile manufacturers in China, China's current economic growth is assessed around 4% instead of official 7%.
In addition, China's statistic bureau disclosed that their growth of working-age population peaked this year. Chinese government cannot change these two determinants of their economic growth just like their stock market intervention even though they try all the economic measures. According to a CEO of a Japanese auto parts manufacturer that sells most of the automobile manufacturers in China, China's current economic growth is assessed around 4% instead of official 7%.
5
Interesting no mention the Shanghai Composite is up slightly over 10% over the last 2 days which about halves the recent plunge of 22 percent which still leaves the exchange up about more than 35% year on year. Also typical the contortions the author goes into to suggest censorship of the issue when there is in fact wide discussion in social media and traditional media. The NYT news judgement may be that people should be running around with their hair on fire about a stock market correction but the Chinese differ. Sort of like the NYT burying the 10% gain in the last 2 days. It was big news when it dropped but now that its stabilising and going back up well somehow just not as newsworthy. As far as discussions of the health of the general economy these are constant elements in all media coverage and complaints about the job market for recent
graduates have been a fixture for years in all media. However wages both white collar and blue continue to steadily rise. Also curious the Caijin inquiry is referenced but not the broader investigation by the government into malfeasance and stock manipulation by the brokerage houses which often use corruptible media to spread useful rumours they can make money on. I suspect that is not covered because too many Americans would believe their own brokerage houses should have been investigated after the 2008 financial crisis.
graduates have been a fixture for years in all media. However wages both white collar and blue continue to steadily rise. Also curious the Caijin inquiry is referenced but not the broader investigation by the government into malfeasance and stock manipulation by the brokerage houses which often use corruptible media to spread useful rumours they can make money on. I suspect that is not covered because too many Americans would believe their own brokerage houses should have been investigated after the 2008 financial crisis.
9
The media and the people have been waiting for this
moment. Finally it has arrived. India will report its GDP
numbers which will be artificially inflated by changing
the methodology in May 2014 when Modi came to power.
That change spiked the number from 5% to 7%.Would
media even mention the change in methodology. Not
a chance.India is our strategic partner while China is our
strategic adversary. GDP numbers are all over the place-
from 3% to 4% rather than 7%. Expertise in the calculation
of GDP galore while we can't calculate our own properly.
A few days ago revised GDP number was announced as 3.6%
while GDI as .06%. They should be the same. As far as
the middle class goes, GDI sounds right because we
are not seeing big gains in our income. Perhaps for 1% it is
3.6%. Statistics lie and liars figure.
moment. Finally it has arrived. India will report its GDP
numbers which will be artificially inflated by changing
the methodology in May 2014 when Modi came to power.
That change spiked the number from 5% to 7%.Would
media even mention the change in methodology. Not
a chance.India is our strategic partner while China is our
strategic adversary. GDP numbers are all over the place-
from 3% to 4% rather than 7%. Expertise in the calculation
of GDP galore while we can't calculate our own properly.
A few days ago revised GDP number was announced as 3.6%
while GDI as .06%. They should be the same. As far as
the middle class goes, GDI sounds right because we
are not seeing big gains in our income. Perhaps for 1% it is
3.6%. Statistics lie and liars figure.
1
The front page of every major newspaper ignored these stories for days. That is the failure of the traditional media. And the whole point of this article is that social media has covered it a great deal. Which means your comment adds nothing.
If you think wages are rising--white collar wages, ha!--then you need to revisit your economics courses. There are plenty of hilarious grammar mistakes in your post: you must be a member of the 50-cent party. Almost as bad as your math.
If you think wages are rising--white collar wages, ha!--then you need to revisit your economics courses. There are plenty of hilarious grammar mistakes in your post: you must be a member of the 50-cent party. Almost as bad as your math.
The Chinese government meets the reality of free market economics. Let's hope they learn something from it.
5
There has never been a free market in China. And while the US had one a few decades ago, that has been eroded by our own Federal and local governments in their chase to greed and control over something they neither worked for or know anything about.
so... their growth is changed from 10% from 6-7%, and still the highest in the world, why our media is so panic about that?
3
Because nobody believes the government's 6-7% when the feet on the ground are saying it's more like 3-5%
1
No one has any idea what the truth of their economy is, much like the vaunted 'sovietologists' of yesteryear. I'm old enough to remember how great the East German economy was supposed to be and it was all false.
In a word, "money"...and 'joyful' would be a more accurate description than 'panic.'
The Chinese downturn makes for good copy which grabs the attention. It upset the "thundering herd" of international investors causing a lot of market excitement and action which makes for good copy that grabs the attention, all relating to more eyeballs viewing the advertising for which the media sells the space or time...
The Chinese downturn makes for good copy which grabs the attention. It upset the "thundering herd" of international investors causing a lot of market excitement and action which makes for good copy that grabs the attention, all relating to more eyeballs viewing the advertising for which the media sells the space or time...
If you think that Chinese stock crisis is the main problem, think about it again. Guys, prepare yourself for another governmental shutdown. I bet that our government will not find common ground about the budget.
2
Nobody is arguing that the Chinese economy, including its stock market, is 'the main problem'. And the Republicans have already stated that they dare not risk another shutdown when the last one blew up in their faces.
Chinese consumers definitely sound like the US consumers a few years back. Buying only that which is necessary and avoiding debt.
8
Dictator(s) never relinquish power. It's not in their DNA. It's very easy to manage a growing economy especially when you're exporting goods to high demands of foreign companies. The Chinese government were on a euphoric high buying up natural resource companies world wide. They overspent and overbuilt. This is now dead inventory whose assets on the books are extremely overvalued. Now, trying to manage a downturn by dictatorship, who control what information is disseminated, is not going to work. The reality is that only a severe recession is going to clear the dead assets from the books. And with no social net to help people avoid the falling knife, many of the so called middle class will move back to the proletariat class. China will change leadership thinking this will calm the storm, yet there are no captains capable of navigating the corrupt "mother ship."
20
...you reap what you sow--decade-plus of smash-and-grab corruption, opulence and compulsive gambling of a country's future...the PRC gets exactly what it deserves.
More of China's Great Leap Backwards and Cultural Devolution has to do with their own doing...but, hey, they're who they are: blame everybody else but themselves.
More of China's Great Leap Backwards and Cultural Devolution has to do with their own doing...but, hey, they're who they are: blame everybody else but themselves.
13
Control, that is what government is always about. In China, as the market economy grows the government will find it increasingly more difficult to have control. The only thing that can save China is for its people to find a way to have a multi party form of government. Sadly, that will not happen without violence taking place. The Genie is out of the bottle.
2
We should praise the economic changes that the new china doing
4
Give the Chinese consumer due credit. When times are tough, some switch to "Made in China" junk sold at Wal-Mart, while others choose to avoid buying that junk altogether.
5
I have spent many years as a foreign correspondent in Asia and I can tell you it is wrong to presume that China's wealth represents smart also !
China is still a communist State run by dictatorial despots and their tremendous economic wealth is based on industrialization. However the majority of Chinese are NOT well educated like in America, they are mostly low paid factory workers.
Those with real wealth and influence are ONLY interested in profits NOT patriotism, that's why most are desperately trying to buy property overseas and move to the US,Europe etc.
China is ruining the economies of many countries and at this time boycotting em would NOT be such a bad idea !
China is still a communist State run by dictatorial despots and their tremendous economic wealth is based on industrialization. However the majority of Chinese are NOT well educated like in America, they are mostly low paid factory workers.
Those with real wealth and influence are ONLY interested in profits NOT patriotism, that's why most are desperately trying to buy property overseas and move to the US,Europe etc.
China is ruining the economies of many countries and at this time boycotting em would NOT be such a bad idea !
10
This piece was fascinating by how much it showed the problem with a government controlled free market system. State driven capitalism only works so far until crisis hits... And as we see here, the consequences ate predictable. Human nature being whst it is, consumers will do the opposite if what's needed when fear takes over.
I'd hate to live in a system of of loe information and high state control. Capitalism has its flaws but selective meddling to control boom bust cycles isn't the answer either.
I'd hate to live in a system of of loe information and high state control. Capitalism has its flaws but selective meddling to control boom bust cycles isn't the answer either.
4
That's what Hoover said. And the rich raked it in even in the midst of the Great Depression, while people were cast out of their lives into Hoovervilles and gross penury. And that was fine with the bankers and tycoons and their hangers-on. But there was no end to the needless suffering of most until FDR and the New Deal. Which the wealthy graspers have hated and sought to undo from that day to this. They enjoy the game of the "free market", where money gains power and power gains money; they win every play and the rest of us lose. And then another depression, and the chance to take even more from the desperate than usual. I can't see the virtue in that.
1
The Chinese government poured billions of renminbi 7 years ago to stimulate (to create a bubble) the economy. As a consequence of the mass of Chinese people's inability to consume these goods (houses, cars, services) and the contraction of economies elsewhere, the Chinese face the perennial "excess capacity." Which is another symptom of a world economy based on oiligolopolies or the rule of financial overlords
5
This downward cycle is when government stimulus must step in. That is hard when the whole economic problem began with government stimulus run wild.
There still isn't any other way.
The solution is to direct income, getting it directly to consumers in ways that cause it to be spent.
This could be things like the recent US program to encourage new car purchases, and the past GI Bill that encouraged residential home mortgages. Food stamps do this, and many countries subsidize food purchases much more generally than does the US. China could do that for awhile -- spend it or lose it gets it spent, and on food.
There are many ways to get money directly to consumers, and to get them to spend it. Vouchers. Credits. Matching funds. Imagination can offer countless options. All of these things would be both a stimulus, and a stimulus specifically to bolster a consumer economy.
These things could be done instead of huge spending projects that have already passed the maxed out level to insanity. They might even cost less in total while doing much more good. They could have the desired effect, despite the big projects having poisoned their own well as potential for stimulus.
Actually, the US ought to do some of this too. Our economy needs a revived consumer demand, not yet more money for rich people to use in speculation.
There still isn't any other way.
The solution is to direct income, getting it directly to consumers in ways that cause it to be spent.
This could be things like the recent US program to encourage new car purchases, and the past GI Bill that encouraged residential home mortgages. Food stamps do this, and many countries subsidize food purchases much more generally than does the US. China could do that for awhile -- spend it or lose it gets it spent, and on food.
There are many ways to get money directly to consumers, and to get them to spend it. Vouchers. Credits. Matching funds. Imagination can offer countless options. All of these things would be both a stimulus, and a stimulus specifically to bolster a consumer economy.
These things could be done instead of huge spending projects that have already passed the maxed out level to insanity. They might even cost less in total while doing much more good. They could have the desired effect, despite the big projects having poisoned their own well as potential for stimulus.
Actually, the US ought to do some of this too. Our economy needs a revived consumer demand, not yet more money for rich people to use in speculation.
21
Once public perceptions about government's inability to manage economy gain ground it's impossible to restore confidence soon. Thus, when the Chinese authorities tried to revive the collapsing stock market through massive infusion of public money it hardly worked. Similarly, the currency devaluation move aimed to get export advantage and boost domestic demand too seem to be proving ineffectual in calming public anxieties . In short, it's a major crisis of confidence centered on the country's governance and economic management that's being confronted by the Chinese authorities, which can never be won through half-hearted cosmetic moves.
16
Now we know where the middle class went.
5
Ah...the best laid plans of mice, men and Mao.
17
Mainland Chinese have no one to take care of them in their old age. Only about a third have company pensions, which don't pay much, and there is no social security like we have in the U.S. The one-child policy over the past generation also limits the expected financial help children can provide, and even the younger Chinese are raised to think about the future - now. This might have been a hard sell for parents until recently.
China's savings rate has hovered right around 50% for a decade, despite governmental efforts to increase consumption. It's simply not going to increase because the government says it should. A lot of mainland parents are no doubt looking at their kids these past few months saying, "See, we told you. Save your money."
China's savings rate has hovered right around 50% for a decade, despite governmental efforts to increase consumption. It's simply not going to increase because the government says it should. A lot of mainland parents are no doubt looking at their kids these past few months saying, "See, we told you. Save your money."
32
What China needs to do is increase tax on the wealthy and increase retirement benefits paid to retired government workers and farmers. A similar program akin to Social Security that unfarely transfers wealthy from the upper to the middle and especially the lower class for the sake of social stability.
saving is in the vein of asian. it's a very good behavior.
Finally what everyone expected. The Chinese leadership can direct the economy to a gradual landing at a sustainable level of growth. Wolf! Wolf! Wolf! You can throw people in jail, but you can’t let the Chinese or global economy get sick. No-way. In China the Politburo members are the Chief Executive Officers of 80% of the business interests. The Party spends more money on domestic security than on military might. Protest can be snuff out before they start. Instead of criticizing the Chinese government - the government should be given accolades for economy reform under stress.
3
There are credible reasons to believe that the superior performance of the Chinese economy may be coming to an end and with it added pressure on the ruling class to relinquish more power and freedom to the country's citizens. The country's economic past performance allowed leaders to maintain a tight grip on individual freedoms. As growth becomes closer to normal the citizens will be less patient with the lack of freedom and rights. Let's hope the transition will be peaceful.
It is said by the ruling class that postmodern China was governed by "heavenly sanctioned" principles depicting the best way to be human. Other nations could live by the same principles but they could never be like the Chinese in defining what is proper and having society comply with such teachings.
From a Chinese perspective being Chinese means to practice proper behavior and to be a part of a civilization that is better than the rest of the world. The discussion amongst Chinese in today's times is what values should their race stand for. Our hope is they get spoiled by the freedoms we have. The Chinese government's hope is if they treat their citizens like a good father they will continue to rule. Even the child that obeys all orders from the father wants to live his own life.
http://lstrn.us/1MjPlJ4
It is said by the ruling class that postmodern China was governed by "heavenly sanctioned" principles depicting the best way to be human. Other nations could live by the same principles but they could never be like the Chinese in defining what is proper and having society comply with such teachings.
From a Chinese perspective being Chinese means to practice proper behavior and to be a part of a civilization that is better than the rest of the world. The discussion amongst Chinese in today's times is what values should their race stand for. Our hope is they get spoiled by the freedoms we have. The Chinese government's hope is if they treat their citizens like a good father they will continue to rule. Even the child that obeys all orders from the father wants to live his own life.
http://lstrn.us/1MjPlJ4
8
"The country's economic past performance allowed leaders to maintain a tight grip on individual freedoms. As growth becomes closer to normal the citizens will be less patient with the lack of freedom and rights. Let's hope the transition will be peaceful."
So has American civil liberty been increased as the economic situation for middle and lower class got worse following the 2007/2008 market crash?
So has American civil liberty been increased as the economic situation for middle and lower class got worse following the 2007/2008 market crash?
3
Our lack of civil liberties is not the problem. Our problem is the lack of willingness on the part of us citizens to exercise our liberties. Citizens United needs overturning and it will not happen unless our citizenry gets mad enough to take action. As Justice Scalia points out in this 2 minute video clip, it will not be easy... http://lstrn.us/R6K4M2
1
"From a Chinese perspective being Chinese means to practice proper behavior and to be a part of a civilization that is better than the rest of the world."
So does corruption and awful environmental degradation seem to play such a big role?
So does corruption and awful environmental degradation seem to play such a big role?
1
Talk about burying the lead! The fact that Caijing newspaper kept the story online while their reporter was "detained" (on a trumped up conspiracy of journalistic bear raids) shows us a new boldness and individuality in China, led by entrepreneurs.
After all the talk of "regime change" in the 1980's and 1990's in China, here we have real evidence of market-led opinion divergence in China, not caused by an invading army, drones or bombs, but by simple market evolution. It's not much of a "story" but compared to decades of sanctions against Cuba, Iran, and North Korea, it certainly makes a quiet point.
After all the talk of "regime change" in the 1980's and 1990's in China, here we have real evidence of market-led opinion divergence in China, not caused by an invading army, drones or bombs, but by simple market evolution. It's not much of a "story" but compared to decades of sanctions against Cuba, Iran, and North Korea, it certainly makes a quiet point.
16
Call me a pessimist I just don't believe any downturn in the Chinese economy is going to diminish the grip of the CCP on the people. American "analysts" used to peddle the line that creating a middle class is going to liberalize China. Well it didn't happen. Now some say the downturn is going to force the CCP to change. I know the statements are not necessarily made by the same people but still, you cannot have it both ways.
11
I'm not sure why you call the independent commenters "market-led." My experience in China, which includes about two and a half years of residence there, tells me that many, perhaps most, of commenters are university students and recent university graduates, variously employed, both in "the market" and elsewhere. The key, it seems to me, is not so much the market as the openness of communication provided by the Internet (despite the Firewall) and residence abroad in places where news is not so tightly controlled by the government.
This is a surprise? How could that be? Lowering the value of the currency means that the same wages buy less than they had. The government lowered the value of the currency to make their goods more attractive to export buyers but made both imports and domestic goods more expensive for the Chinese consumers.
12
lowering the value RMB doesn't effect any ordinary chinese if you dont want to have the vacation oversea.
gas price is very cheap nowadays. the cheap RMB is definetly useful for the export biz.
gas price is very cheap nowadays. the cheap RMB is definetly useful for the export biz.
Despite the recent major downturn, the Shanghai exchange composite has still seen a phenomenal 50% gain over the past year. Nevertheless, many first time Chinese stock investors who got into the market recently have no doubt been wiped out. Naive about the volatility of capital markets and denied any credible news reporting when things are trending badly, it's small wonder Chinese who could still afford to buy stock have soured on the proposition. By rigidly controlling objective news reporting, censorship has now come back home to roost in the central offices of the Chinese oligarchy--the enforced news vacuum along with vast internet censorship have become a colossal albatross. There is clearly a huge recession going on in China that is much bigger than what's reflected by stock market volatility. Burning coal for 80% of electricity needs, a paradoxical gigantic skilled labor shortage, and huge oil imports are but a few indicators causing a very nervous Chinese ruling elite--with no relief in sight.
11
"Growth for the sake of growth is the ideology of a cancer cell."
In Europe. In America. In Asia.
Some day the entire house of cards will come tumbling down.
However, I probably won't be alive, so it won't be my problem.
In Europe. In America. In Asia.
Some day the entire house of cards will come tumbling down.
However, I probably won't be alive, so it won't be my problem.
26
Growth for the sake of growth is the ideology of all living things. Grow, multiply, or extinction.
It is sad that you have so little care for your children or others who will come after us. Puts me in mind of what Bush said when he was asked how he thought history would see his administration; he answered, "History? Who cares? We'll all be dead then." And this was the president of the United States. We need to do what we can now, while we can, to leave a viable nation and world for those human beings who follow us, our own children and theirs.
1
The Communist Party will fall within a decade, not because of economic factors (which they seem to fear most) but because of their efforts to control information. This will backfire in spectacular and dramatic fashion. One of these days, the regime will be undone by a single app!
11
Not if China have NSA's skill and controls all social media platforms and search engines a la NSA.
You needs to read some dissertation on how NSA and CIA uses social media to influence opinions.
You needs to read some dissertation on how NSA and CIA uses social media to influence opinions.
3
What makes you think the Chinese don't have the skill and control of the NSA - For that matter, surpassing that of the NSA?
I'v heard similar comments like yours since 1989. But I don't think the communist party will fall in the near future. Most people here in US do not really know what is happening in China. Do you know why the communist goverment won't fall, at least in the near future? It's because the goverment is doing A LOT to improve ordinary people's life and keep social stability. China is trying to follow the Singapour model.
perhaps it may be a good time for the world to develop measures of success other than gross levels of resource consumption.
50
I hope you are right though I highly doubt it.
8
It is sad how all the hard work of the Chinese people to make a productive society is being used by the Communist masters to keep themselves in power. The people worked hard to generate considerable wealth for the country even after 50 years of the disastrous policies of Mao. Now that accumulated wealth is being used to prop up companies that pollute the air, spill toxic chemicals, and enrich an entitled group of Princelings.
42
1. Mao didn't rule China for 50 years, think half of that and those includes years where he can barely walk.
2. How's that different from any other country? Ever tried to not pay tax because you disagree with government's foreign/domestic policy?
2. How's that different from any other country? Ever tried to not pay tax because you disagree with government's foreign/domestic policy?
2
Americans did the same back in the 19th century - built factories, railroads, etc. so the robber barons (whom some of our towns and schools and universities are named after in CA) could live in luxury. Sad? It's capitalism, like the song says 'the rich get more, while the poor stay poor'.
3
Not that different from how millions of Americans were cast out on the streets in 2008-2010 and are still there because our lords and masters don't care about anyone but themselves.
1
So, financial reporting standards to so some degree apply to China. How is that we don't report what is really going on. Why is there not a class at Beijing Univerasity say, called 'Republic of China corporate auditing 301' . I'm sure there is and why don't we audit it.
3
They call themselves Chinese People's Republic, derived from the same old Chinese Soviet Republic of the old when the top leadership was dominated by the Soviet trained Chinese Communists until Mao became their locally grown God. Nowadays they change it to People's Republic of China, I guess, to make it sound like the old, collapsed Republic of China, a name and a change for a republic since 1911 that Mao is said to have said he regretted.
A simple problem, widely ignored by pundits and even respected economists is that ALL the books in China are cooked. Economics is admittedly a less than rigid 'science' and although it talks in numbers & thus appears 'concise,' even in the West there is 'no there there' much of the time (witness the endless and conflicting opinions concerning the recent market 'correction.' But in China, matters are materially worse when it comes to getting remotely good numbers. Much of the economy consists of state-owned enterprises & banks whose managers are under order to 'succeed.' So not only are books cooked to make the results look good but, to make matters worse the govt' orders businesses to borrow money and buy stocks to further manipulate the numbers which are already well cooked. None of this should come as a surprise; a market economy run by dictates of a government composed of communists is not teeming with free market experts.
Every indication is that moves by both the Chinese oligarchy to make more cheap money available, combined with Chinese consumers, already a spending-averse bunch, withdrawing further into their silk cocoons, will make fixing the structural problems in China and the world trade imbalances it has leveraged to advantage, much more difficult. Chinese imports are becoming cheaper, but for us and Europe to gorge on them will give us the false impression that everything is fine when, long-term, it is not. As Robert Preston, of the BBC business section, pointed out, this many years after the worst downturn since the Great Depression, and things are essentially where they were before 2007 in terms of world economic problems. This points to structural problems which seemingly defy easy solutions.
19
I've been saying this for years: The correct strategy for the US is to DIVERSIFY its imports. We do not need to concentrate our business with China. We can and should share our trade throughout the world, especially with friendlier nations that share our values.
38
Trade with China is the definition of diversification. China is the world's 2nd largest economy so naturally it will be the U.S.' largest trading partner. China is also not an ally so it shows the U.S. is not nitpicking who we should trade with.
1
Allow me to add to this. Imagine if our primary trading partners were Mexico and the Central American states. The upside would be wealthier nations to our south providing for more stable governments, less illegal immigration, less poverty, higher literacy rates and an alternative to the narco economy. Wouldn't that be a win-win for both conservatives and liberals and greater security for all of us?
Trade is driven by price. If the best deals are with China, we're going to concentrate our business with China, pure and simple. The market demands it.
"Then the sharp drop in the Chinese stock market this week, following a steep midsummer fall that had been slowed only through muscular government intervention, destabilized stock markets worldwide."
China's recent stock market crash happened after their central bank stopped buying stocks for two days, according to several online financial articles. That means there is insufficient interest from the investing public to support their stock market, so China's central bank is acting as the equities buyer of last resort. The U.S. market is also dependent on central bank support, which is why it crashed about the same and then perked up in response to various central bank stimulus measures.
China's recent stock market crash happened after their central bank stopped buying stocks for two days, according to several online financial articles. That means there is insufficient interest from the investing public to support their stock market, so China's central bank is acting as the equities buyer of last resort. The U.S. market is also dependent on central bank support, which is why it crashed about the same and then perked up in response to various central bank stimulus measures.
9
Perhaps the Chinese leadership will figure out that you can't control everything.
19
Just wait til the peasants rise against their commie masters!!!
5
And without actual information, you cannot stay ahead of pricing and availability.